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Office Depot To Shut 112 Stores

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By ASHLEY M. HEHER

The Associated Press

Published: December 11, 2008

CHICAGO - Office Depot Inc. will close about 9 percent of its North American stores and cut 2,200 jobs during the next three months while planning to open fewer locations next year in an effort to cut costs.

The plan to shutter 112 stores will reduce the chain's base to 1,163. It plans to close 45 stores in the central United States, 40 in the Northeast and Canada, 19 in the West and eight in the South.

Office Depot, which began the year with about 49,000 workers, also will close six of its 33 North American distribution facilities.

The Delray Beach-based company said it plans to shut another 14 stores next year while opening just 20 new sites, half of what it planned.

Analysts said the move was needed and will likely give the company a much-needed short-term financial boost. But they said they doubted the effort would be enough to fix the company's financial condition.

"It's not enough to really close the gap and make a meaningful impact compared to Staples and the mass merchant competitors," said Morningstar analyst R.J. Hottovy. "But it's probably a Band-Aid on a flesh wound."

The struggling retailer reported a third-quarter loss because of slumping sales as consumers and small businesses cut back spending in October.

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